U.S. Securities and Exchange Commission headquarters in Washington, D.C. (Photo: Diego M. Radzinschi/ALM)Whistleblower Awarded $4.5M for Reporting Internally and to SEC Within 120 Days
A whistleblower sent a tip to the SEC within 120 days of reporting internally, which sparked the company to self report. This is the "first time a claimant is being awarded under this provision of the whistleblower rules," according to the agency.
May 24, 2019 at 02:54 PM
3 minute read
The U.S. Securities and Exchange Commission has issued a $4.5 million whistleblower award, the first given under a provision incentivizing employees to submit allegations to the agency within 120 days of internal reporting.
Friday's award is the latest in a series of massive whistleblower awards, and not just from the SEC. During one week in March, whistleblowers in unrelated cases received $86 million in awards, including $1.87 million for the former general counsel of the Houston Housing Authority. A press release from the SEC Friday claims the agency has awarded “$381 million to 62 individuals since issuing its first award in 2012.”
“In this case, the whistleblower was credited with the results of the company's internal investigation, which were reported to the SEC by the company and led to the Commission's resulting enforcement action and the related action,” said Jane Norberg, chief of the SEC's Office of the Whistleblower, in a statement Friday.
The latest award goes to an unnamed company and employee who, according to the SEC, sent an anonymous tip to the employer alleging “significant wrongdoing.” The whistleblower also notified the SEC within 120 days, making the employee eligible for an award under 2011 rules adopted by the agency to promote internal reporting.
After receiving the tip, the company launched an internal investigation into the ”allegations of misconduct” and self-reported to the SEC, which began its own probe. Upon completing the internal investigation, the company shared its findings with the SEC.
“The whistleblower gets credit for the company's internal investigation because the allegations were reported to the Commission within 120 days of the report to the company,” Norberg said.
This is the ”first time a claimant is being awarded under this provision of the whistleblower rules,” according to the SEC. The agency said whistleblowers may be eligible for an award if they “voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action.”
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